Luxembourg Struggles with Critical Shortage of Skilled Workers Across Key Sectors

Luxembourg Struggles with Critical Shortage of Skilled Workers Across Key Sectors

Luxembourg is grappling with a pressing issue as its national job agency, Adem, identifies a significant shortage of qualified candidates in 24 specific job segments, including banking, auditing, engineering, and education.

Despite a rising unemployment rate, these critical roles remain unfilled, prompting Adem to designate them on its official shortage list. This move allows companies to streamline the hiring process for non-EU nationals in an effort to address the labor deficit.

In 2023, the sought-after positions included credit and risk analysts, front office workers, and customer management staff in banking, as well as roles in roofing, engineering, caregiving, nursing, psychology, education, auditing, and accounting, among others. Adem’s criteria for high-demand roles were based on an average of seven monthly vacancies and a fill rate of less than 10% to 25%.

However, challenges persist for international IT workers seeking employment in Luxembourg, with many feeling excluded due to language barriers, particularly in French proficiency.

Luxembourg’s struggle to attract highly skilled personnel is compounded by its high cost of living, notably expensive housing, which has deterred potential candidates for years.

Despite a rising unemployment rate, which reached 5.6% in February, the country faces a paradoxical situation with fewer job seekers compared to the previous month. Additionally, the growth in Luxembourg’s labor market slowed in 2023, experiencing a rare recession that notably impacted the construction sector, according to the national statistics office, Statec.

While overall employment increased by 2.2% last year, down from 3.4% growth in 2022, the construction sector witnessed a decline of 0.9% in jobs between 2022 and 2023, following a 2.7% growth from 2021 to 2022. This trend underscores the multifaceted challenges facing Luxembourg’s labor market, necessitating strategic measures to address the critical shortage of skilled workers across key sectors.

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